28261.doc

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE INVESTIGATION TO ESTABLISH THE IDAHO NON-RURAL UNIVERSAL SERVICE FUND AS REQUIRED BY IDAHO CODE § 62-610A-F.
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ORDER OF CONSOLIDATION

NOTICE OF HEARING
NOTICE OF SCHEDULING

ORDER NO.  28261

The 1998 Legislature amended Idaho Code Title 62 to create a new Universal Service Fund. See Idaho Code  62-610A through F. Idaho Code §§ 62-610A-F require the Commission to “establish a competitively and technologically neutral funding mechanism which will operate in coordination with federal universal service support mechanisms.” Initially, this new fund will only be available to nonrural local exchange carriers that meet the statutory criteria. Idaho Code § 62-610B also makes clear that all telecommunications providers, including “municipal, cooperative or mutual telephone companies and telecommunications companies providing wireless, cellular, personal communications services and mobile radio services for compensation” may be eligible for the new Non-Rural USF support and all their customers will pay a surcharge to fund the new USF.
This new USF differs considerably from the existing Idaho USF that currently provides high cost support to rural incumbent local exchange carriers (ILECs). See Idaho Code  62-610. Distributions from the present Idaho USF are generally calculated to meet residual revenue requirements for fully regulated Title 61 rural ILECs whose residential and small business rates are 125% of the weighted statewide average rates. The rural Idaho USF may be phased out sometime after January 1, 2001. Idaho Code  62-610F(4).
The new USF statute requires that disbursements from the new fund be used to defray costs, as determined by the Commission, for providing “universal service” to customers within a geographic support area. In calculating and determining those costs, the Commission must use a “forward-looking cost methodology.” Idaho Code § 62-610F(2).
On December 19, 1997, the Commission opened a docket to analyze cost models and adopt a forward-looking cost model as required by Idaho Code § 62-610F. (Case No. GNR-T-97-22). That docket is still open and further evidentiary proceedings are pending. The Commission finds that the decisions made in that docket and its record are related to decisions to be made in this one. The Commission further finds that no party will be prejudiced by consolidating these two proceedings. Therefore, the Commission hereby consolidates GNR-T-97-22 and this docket, GNR-T-00-2, for purposes of hearing.
In response to the Legislature’s statutory directive, the Commission has taken several other steps toward establishing and implementing this new Idaho Non-Rural Universal Service Fund (Idaho Non-Rural USF).
In order to be eligible to receive this new Idaho Non-Rural USF support, local exchange carriers (LECs) must offer to provide “universal service” throughout the service area for which the designation is received. Idaho Code  62-610B(1). The Commission must designate both the services (“universal service”) that must be offered and the geographic area (“service area”) in which they must be offered. See Idaho Code §§ 62-610B-E.
Therefore, on July 16, 1998, the Commission opened two other dockets (GNR-T-98-7 and GNR-T-98-8). GNR-T-98-7 was opened to consider what telecommunications services constitute those services that must be made available to Idaho consumers by eligible telecommunications carriers to meet their obligation to provide universal service and receive Idaho Non-Rural USF support. The Commission designated those “universal services” September 8, 1998. Order No. 27715. The Commission has not issued any decision in GNR-T-98-8, because the appropriateness of the service area may be affected by the cost model chosen.
The purpose for this proceeding is to establish and implement the new Idaho Non-Rural USF. At a minimum, the Commission must
a. Adopt a cost benchmark for determining Idaho Non-Rural USF support eligibility,
b. Determine what level of computed cost demonstrates “high cost,”
c. Identify geographic “support” areas and determine whether the Commission will only use the cost benchmark to identify a high-cost “support” geographic area or whether other additional criteria, like competition, geography or population distribution might be used to determine whether a geographic area needs support,
d. Determine the support percentage for the difference between the benchmark and forward-looking cost,
e. Determine a mechanism for preventing recipients from redundant recovery,
f. Determine the number of access lines in a “support” area that will be supported by Idaho Non-Rural USF,
g. Determine what portion of the costs above the benchmark will be supported by Idaho Non-Rural USF,
h. Set the surcharge to be collected from customers.
Therefore, the Commission adopts the following schedule for consideration of these issues.
YOU ARE HEREBY NOTIFIED that the Commission has determined that the following schedule will control the process of this case:

March 8, 2000

May 17, 2000

June 14, 2000

August 1-4, 2000
All parties file direct testimony.

All parties file reply testimony.

All parties file rebuttal testimony.

Hearing.
YOU ARE HEREBY NOTIFIED that the Commission will convene a hearing in this case on AUGUST 1, 2000, AT 9:30 A.M. IN THE COMMISSION HEARING ROOM, 472 WEST WASHINGTON, BOISE, IDAHO, and continuing until completed.
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter for the purpose of presenting evidence or cross-examining witnesses at hearing must file a Petition to Intervene with the Commission pursuant to this Commission's Rules of Procedure 72 and 73, IDAPA 31.01.01.072 and -.073. Persons intending to participate at the hearing must file a Petition to Intervene no later than fourteen (14) days from the service date of this Order. Persons who are already parties to GNR-T-97-22, consolidated with this proceeding, do not need to file new Petitions. Persons desiring to present their views without parties' rights of participation and cross-examination are not required to intervene and may present their comments without prior notification to the Commission or the parties.
YOU ARE FURTHER NOTIFIED that persons desiring to participate in this case for the purpose of receiving comments, testimony or any other documents filed by other persons or Commission Orders or further notices issued by the Commission in this case, must notify the Commission Secretary in writing that they desire to be placed on a service list to receive comments, Orders, and Notices in this proceeding. Persons desiring to participate in this case and remain on the service list must notify the Commission Secretary no later than fourteen (14) days from the service date of this Order. The Commission Secretary shall then publish a Notice of Parties.
YOU ARE FURTHER NOTIFIED that all hearings will be conducted pursuant to the Rules of Procedure adopted by the Idaho Public Utilities Commission. IDAPA 31.01.01.000 et seq.
YOU ARE FURTHER NOTIFIED that all hearings and prehearing conferences in this matter will be held in facilities meeting the accessibility requirements of the Americans with Disabilities Act. Persons needing the help of a sign language interpreter or other assistance of the kind that the Commission is obligated to provide under the Americans with Disabilities Act in order to participate in or to understand the testimony and argument at a public hearing may ask the Commission to provide a sign language interpreter or other assistance at the hearing. The request for assistance must be received at least five (5) working days before the hearing by contacting the Commission Secretary at:

IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone] (TELEPHONE)
[phone] (TEXT TELEPHONE)
[phone] (FAX)

O R D E R
IT IS HEREBY ORDERED that the schedule set forth in this Notice shall control the processing of this case.
IT IS FURTHER ORDERED that all matters in this proceeding are consolidated with Case No. GNR-T-97-22 for the purposes of hearing unless otherwise noted.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of January 2000.

DENNIS S. HANSEN, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

PAUL KJELLANDER, COMMISSIONER

ATTEST:

Myrna J. Walters
Commission Secretary

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Any application of this new fund to rural LECs to replace funding available pursuant to Idaho Code § 62-610 cannot begin earlier than January 1, 2001.
A support area is a “geographic area designated by the commission as a high-cost area for which eligible telecommunications carrier(s) serving such area may receive financial assistance from the universal service fund.” Idaho Code § 62-610B(4).

ORDER OF CONSOLIDATION
NOTICE OF HEARING
NOTICE OF SCHEDULING
ORDER NO. 28261 -5-

Office of the Secretary
Service Date
January 18, 2000